Berkeley re­ports higher net in­come for the first half

LONDON: Berkeley Group Hold­ings Plc, the U.K.'s sec­ond-largest home­builder by mar­ket value, said first-half profit rose 20 per­cent as the com­pany sold more houses.

Net in­come climbed to 44.4 mil­lion pounds ($69 mil­lion) in the six months through Oc­to­ber from 36.9 mil­lion pounds a year ear­lier, the Cob­ham, Eng­land­based com­pany said in a state­ment to­day. Rev­enue in­creased 16 per­cent to 336.2 mil­lion pounds.

The home­builder has ben­e­fited more than some com­peti­tors from an in­crease in de­mand for homes in the south­east of Eng­land, which started in April 2009, be­cause of its fo­cus on the area. Berkeley sold 1,249 homes in the first half com­pared with 914 a year ear­lier.

"We see an ane­mic re­cov­ery," Man­ag­ing Di­rec­tor Rob Per­rins said in an in­ter­view. "Credit is con­strained out there, es­pe­cially for peo­ple get­ting mort­gages. There is a lot of un­cer­tainty." U.K. con­sumer con­fi­dence fell to a 19-month low in Oc­to­ber as Bri­tons faced the deep­est bud­get cuts since World War II, Na­tion­wide Build­ing So­ci­ety said on Nov. 12. House prices have fallen for five months in a row, ac­cord­ing to Home­track Ltd.

Berkeley rose 4.5 per­cent to 878 pence in London trad­ing, its biggest gain since May. That boosted its mar­ket value to 1.15 bil­lion pounds and ex­tended its gain this year to 7.1 per­cent, mak­ing it the only U.K. home­builder that has shown an in­crease. Redrow Plc, the nextbest per­form­ing com­peti­tor, has lost 11 per­cent.

Sales reser­va­tions have risen by 20 per­cent com­pared with the last fis­cal year, Per­rins said. The op­er­at­ing mar­gin of 17.4 per­cent that Berkeley achieved in the first half will prob­a­bly be lit­tle changed in the sec­ond, he said.

"Good per­for­mance in the first half," Peel Hunt an­a­lyst Robin Hardy said in a note to in­vestors to­day. -Bloomberg